Get in touch with us

Book a FREE consultation
and receive your complimentary eBook

Get started with a free strategy consultation and receive a copy of the Good Fortune Guide – written by James McFall, Managing Director Yield FP and 2020 National Finalist Certified Financial Planner of the Year to help educate you on your Financial Plan.

    What areas of financial planning are you looking for advice on?

Book a FREE consultation
and receive your complimentary eBook

Get started with a free strategy consultation and receive a copy of the Good Fortune Guide – written by James McFall, Managing Director Yield FP and 2020 National Finalist Certified Financial Planner of the Year to help educate you on your Financial Plan.

Creating a Retirement Plan For an Investment Savvy Couple in Their Second Marriage

Creating A Retirement Plan For An Investment Savvy Couple In Their Second Marriage

A Yield Client Case Study

$1,932,061 more at Philippa age 90

Strategic planning with estate planning considerations for a blended family

Proactive investment strategy replaced passive savings going in cash

Save $1,708 p.a. by moving tax and audit provider for SMSF

Our clients George and Philippa are a couple in their late 50s, who came to us wanting to know how well their existing assets would provide for them and wanted advice on creating a retirement plan for their goals. 

 

Specifically, they wanted us to assess what age they would be able to retire at and what they would need to do in retirement to keep their investments providing for their lifestyle.

 

A unique consideration for Philippa and George is that they are in their second marriage and have children from both relationships.

 

Introduction – Creating A Retirement Plan

George and Philippa had done a good job building an investment portfolio of direct shares and property, as well as inheriting assets, that contributed to their position. 

 

The couple were looking for clarity on if what they had was enough to see them through retirement and allow them to move to part-time work for 2 or 3 years before their ideal retirement age of 65. 

 

Our job was to project what their current investments and super could provide for them in retirement and to advise on what they could do to optimise their investment strategy, as they progress in retirement. 

 

A concern for them was determining when they would need to sell their investment properties, owned inside an SMSF; and being sure that their investment strategies were making the most of the strategic opportunities available to them. 

 

Overview

The couple had already developed a successful investment portfolio with an SMSF shared between the two. Assets included shares in ASX listed companies, two investment properties held in their SMSF, as well as cash in the bank, which was growing and underutilised. 

 

They also owned their primary place of residence, which they want to keep for the foreseeable future and if they do eventually move, wanted to know they could retain the same overall value in their home.

 

Our financial projections identified that given the strong financial position they are already in, they would be able to achieve their goal of retiring at age 65 and be able to scale back from work at Philippa’s specified age of 63, and George doing this at age 62. 

 

Whilst this was made possible by the couple’s investment and financial choices to this point, creating a retirement plan gave them real clarity about their financial prospects and provided a clear step-by-step sequence of recommendations which helped improve the tax, investment and estate outcomes, supporting them to feel secure and confident in achieving the milestones which were important to them throughout retirement. 

 

The benefits of our advice and projections long term will help ensure that the couple has an actively managed and personalised investment portfolio that will provide for their retirement well into the future and illustrate for them what they would need to do in retirement to make the most strategic financial decisions to benefit their plans. 

 

 

Outcomes – Creating A Retirement Plan That Lasts 25+ Years

We recommended that George and Philippa continue maximising concessional contributions to super, now $27,500 a year, which would mean a tax saving of $8,566 per annum. 

 

We also advised on contributing non-concessionally to super in the 2021-22 financial year to the sum of $300,000 – $330,000 to help consolidate their financial position more tax favourably. 

 

A core concern of the couple was knowing when they would need to sell their investment properties owned within their SMSF, which we found would need to happen in the 2046 financial year on current trajectory. 

 

With the recommended strategy we advised the couple to implement, we saw this being pushed back an extra 4 years to the 2050 financial year if they wanted to defer this. 

 

When it came to how George and Phillipa’s new investment solutions would be implemented, our first recommendation was that Philippa’s super balance should be transferred into the couple’s SMSF to save over $1000 a year in unnecessary admin and insurance fees.  

 

To manage the couples SMSF, we recommended using an alternative administrator for the accounting who deliver a holistic centralised service to clients of financial advisors and would save an estimated $1,700 per annum in administration costs. 

 

We also recommended that the couple use half of their investable funds to invest into our Managed Discretionary Account service and the other half into a direct portfolio of diversified funds and ETFs, creating two different investment approaches and investment mix. 

 

Doing so would mean more access to a diversified investment portfolio within their SMSF which also needed its investment strategy updated, which we did for them when creating a retirement plan for the couple. 

 

As the pair were already in a position to retire, we identified that they did not need insurance cover to protect against their ability to fund their own income needs anymore.

 

However, George & Phillipa have been using life insurance to even up their overall assets to ensure they could share assets evenly between their children. 

 

Estate planning for couples in second marriages is very challenging to navigate and while life insurance had been helpful to this point, it was evident that they needed to get their Wills reviewed and have a deep discussion about how they progressed from here. 

 

As part of our service, we have offered to be part of the discussion with their Estate lawyer of choice if they would like. This sort of personalised approach that we take here at Yield helps ensure that discussions we have, that are held as part of our clients financial plan are fully considered in the context of the legal ramifications in their Will. 

 

Investing for retirement is not a straightforward or one-dimensional process. 

 

Even when you have already accumulated enough to fund your retirement income needs, having a financial planner to help coordinate your finances for retirement could mean far better prospects, with more certainty and less stress for your post-working life.

New window

Important Note
Produced with our client’s permission. Names within this case study have been changed to protect the client’s right to privacy. The content of this case study has been based on a real-life client. Any information provided here is general advice only and does not consider your objectives, financial situation or needs. This information should not be taken as comprehensive and does not constitute legal or financial advice. You should seek legal, financial or other professional advice before relying on any content. Yield Financial Planning is not responsible to you or anyone else for any loss suffered in connection with the use of this information. Information is only current at the date initially published.
Testimonials

What Our Clients Say

We have entrusted our wealth creation and future security with Yield Financial Planning for a number of years now. They truly are professionals who have stayed ahead of the game by making strategic decisions at the right time and have always given sound advice. Security for our future is in great hands. Thanks Yield Financial Planning!!!

Yield Financial Planning has provided us with professional expert sound advice. It is always a pleasure to deal James and his team who always have our best interests at heart and has set up a sound plan for retirement. James and his team have provided first rate advice and funds management. I have confidence in James’s competence and integrity.

Yield Financial Planning have been excellent in their advice and investment strategies being a pleasure to work with over many years. Their strategies and constant portfolio reviews making changes when needed have guided us right through from our working days, the GFC and now retirement. We hold Yield as being an invaluable necessity.

Just the excellent service we receive and doesn’t matter how many questions we have; the staff are happy to oblige. They follow things through and let us think about important and critical matters methodically with a helping hand along the way. So overall the Journey is pleasant, professional and comprehensive yet it is explained to you what could help you or your needs.

I’ve been with Yield for more than 10 years and I’ve found the advice invaluable in helping to navigate life’s twists and turns. Highly recommended 5 Stars!

I would like to congratulate Yield Financial Planning, for their high quality of care, expertise and knowledge they have provided in ensuring my future growth is heading in the right direction. These qualities have reflected both in results and the ongoing follow up as an existing client, which I find reassuring.

Have been with Yield for a few years as my financial planners, and was very pleased when they announced their Mortgage Brokering Services – their Broker had great communication, and at no time was I unsure of where we were in the process. Being my Financial Planner, I was much more comfortable knowing they had my interests at the forefront of all negotiations – rather than getting a mortgage broker off the street who is probably aligned with a bank. From a more financial perspective, Yield saved us over $5000 per year through reduced interest payments alone – I highly recommend looking into Yield Financial

Penny O’Grady & Trevor Shevchenko
Renae Chapman & Tim Walsh
Kevin & Anne Kennelly
Ken & Frances Moore
Tim Prosser
Angela Henwood
Wade Lamberth & Narges Bayat
decoration leaves 1
decoration leaves 1
decoration leaves 1
decoration leaves 2
decoration leaves 2
Free Consultation

Free Consultation

Get started with a free strategy consultation and receive a copy of the Good Fortune Guide – written by James McFall, Managing Director Yield FP and 2020 National Finalist Certified Financial Planner of the Year to help educate you on your Financial Plan.